Business owners with good credit, rejoice; overextended
borrowers, beware. The Small Business Financial Exchange from
Equifax is putting a lot more information at lenders'
fingertips about their prospective borrowers by pooling data from
participating lenders. That means loan officers can find out from
other financial institutions just how much business owners owe, in
what form-general loans, credit cards or leasing agreements-and
whether they're making good on payments.

Given that most entrepreneurs owe money to more than one
financial institution, that concept might seem scary. However,
according to Dann Adams, Equifax senior vice president of sales for
the Americas, the Exchange-which boasts 20 of the 25 largest
small-business lenders as members-will make banks more likely to
loosen the purse strings because they'll feel confident they
have all the information. "The risk has gone up dramatically
for banks over the last three years," says Adams, pointing to
the proliferation of loan and credit card products online and the
growth in the number of small businesses. "Today, people
expect to get loans in five minutes," he says. "So
[lenders] need better tools to conduct faster online
transactions."

There's Gold in Them Thar
Hills

If gold seems positively anachronistic in a world of digital coins
and virtual bills, be prepared-it could be making a comeback. Not
in physical bars, of course, but as the currency of choice to back
up digital monies used in online purchases, according to a report
commissioned by the World Gold Council.

The world's oldest money has a couple of key advantages.
"First, people trust it," says Richard Rahn, author of
the report and an expert in digital money systems. "Second,
there's a pre-existing demand for gold assets that gives gold a
head start over competitors."
The main challenge at the moment-not surprisingly-is very few
e-commerce players are accepting payment in gold. But a few
companies are working to spread the word, and the metal. E-gold Ltd. allows consumers to
purchase gold, silver, platinum or palladium for the going spot
price and then spend it for free at any e-gold recipient anywhere
in the world for no additional charge. GoldMoney, launched in
February, is an online payments service that offers real-time
transactions in gold that are not subject to chargebacks.
Clearly, though, gold's got a long way to go to achieve
ubiquity. "At the moment, it's a niche product," says
Rahn. "It really depends on how many companies get behind
it."

The Net's Net Effect on
Trading

54%of wealthy Americans worry that their children
will spend beyond their financial means.

If you're worried that allowing employees to access their
401(k)s via the Web will entice them to spend an inordinate amount
of time tinkering with their allocations, there's new research
from the University of Pennsylvania's Wharton School of
Business that says you might have reason to fret. The study, which
looked at data from Hewitt Associates showing the influence of
online trading for 100,000 employee users of two corporate 401(k)
plans found that trading frequency increased after 18 months of Web
access, but the evidence suggested that it was caused by a
combination of the Web and the market. "That might have
happened anyway if the markets were going crazy," says Andrew
Metrick, assistant professor of finance at Wharton and co-author of
the report.

It's something entrepreneurs should be concerned with,
however, given that they have to negotiate contracts with 401(k)
providers based on the level of employee trading activity.
"But unless trading goes up by a factor of 10," says
Metrick, "it's unlikely to have an enormous impact on
costs." Plus, he adds, the Web offers a host of benefits to
entrepreneurs, including simplified administration and the ability
to offer employees more involvement in their own retirement
planning. Of course, for some aggressive traders, less involvement
can mean more cash in the end, says Metrick. "We found no
evidence that people doing their own trading are making any money.
On average, they're just stirring the pot."

C.J. Prince is a New York City writer who specializes in
business topics and the executive editor of Chief Executive
magazine.